1©Jerry P. Miller Outline: How the CI function emerges in a firm Behaviors, Values, & Support Structures How to Change Corporate Cultures Where to place the intelligence function Creating the intelligent firm Roles & skills in the intelligence function

2©Jerry P. Miller How the CI function emerges in a firm Marketplace events triggers CI needs (loss of market chare, lower revenues, competitor movements, or any significant event) Decision Maker requests intelligence product (from R&D, marketing, strategic or product development) Request more frequently & urges other to use intelligence CI staff size increases

3©Jerry P. Miller Cultural Values to Pursue: People acquire information thats easy to access regardless of its quality (Zifts law of least effort) Unfiltered access btw DMs and CI staff –Fast food firm Information sharing –Address: Whats in it for me! Decision makers welcome staff input Understand different DM style (Myers-Briggs) Willingness to adjust organizational processes

4©Jerry P. Miller Structural Factors to Pursue: Interaction btw DMs and CI staff Knowing where to route information Secure organizational processes Integrate CI function & staff across the firm Close proximity of CI staff to DMs –Digital technologies redefined proximity, if all parties use them!

How to Change the Culture: Behavioral Modification

6©Jerry P. Miller Organizational Behaviors to Address: Where will values shift? Who must be trained? How will the intelligence function impact jobs? Whose jobs will be impacted? How will responsibilities shift - corporate and/or operational?

7©Jerry P. Miller Norm The extent to which individuals act in a certain way and are punished when seen not to be acting in this way

8©Jerry P. Miller Create a Behavioral Model What are the behavioral characteristics of the function that you want to model? (use adjectives to clearly describe) Develop a realistic system of rewards and punishments based on the previous definition of a norm Develop a method for monitoring the model behavior

9©Jerry P. Miller Growing the Intelligence Staff Ask staff: How can we help you grow your career? Determine how competencies relate to the various roles within the staff Encourage staff to identify growth areas Encourage staff to attend training sessions Establish a mentoring process

10©Jerry P. Miller Where to Place the Intelligence Function: Determining factors Best practices Organizational options Intelligence staff needs Criteria not to be overlooked

11©Jerry P. Miller Determining Factors Strategic and operational needs are both important Decentralization of decision-making withl networking among staff and coordination at corporate level and in each business unit Address specific competitively important issues wherever they have the greatest impact in the firm

Best Practices: How a Major Pharmaceuticals Firm Considers Key Factors before Locating the Intelligence Function

13©Jerry P. Miller The Firm Recognized that it was Organized Around Key Value Chain Components: R & D Marketing Demand Creation Supply Therefore, they decentralized the intelligence function

14©Jerry P. Miller At its Corporate Level They: Maintain common practices and methodologies Address strategic needs of top management Establish an early warning system to monitor trends that may impact near- to medium-term future Place the intelligence function in the strategic planning department

15©Jerry P. Miller At the R & D Level They: Provide input to long-range technology planning Help direct the application of research moneys in the areas of: –defining promising internally developed products –evaluating the value of externally available technologies

16©Jerry P. Miller At the Product Marketing Level They: Provide support to the development and execution of product marketing strategies within an informal intelligence process

17©Jerry P. Miller At the Sales Level They: Maintain their own intelligence capabilities to guide day-to-day operational issues related to the sales process

18©Jerry P. Miller Three Operational Options for Structuring the Intelligence Process: Centralized Decentralized Hybrid

19©Jerry P. Miller Centralized Intelligence Functions Presume strategic needs dominate Report to a senior corporate officer who –provides resources for intelligence –defines and refines intelligence requirements Rely on input from across the firm Deliver forward-looking analysis

20©Jerry P. Miller Decentralized Intelligence Functions Use multiple staff across the firm Serve operational requirements, rarely to senior management May or may not have small, corporate staff to coordinate activities and to provide strategic products derived from operational findings

21©Jerry P. Miller Hybrid Intelligence Functions Use aspects from centralized & decentralized Establish multiple intelligence units where needed Executive needs dominate, yet ad hoc, operational needs are also met Use consistent methods for collection and analysis

22©Jerry P. Miller Intelligence Staff Needs: Access to and support of decision-making High visibility Links across the firm Nurturing

23©Jerry P. Miller Access to & Support of Decision-Making: Position intelligence staff so they can: –Provide competitive insight –Present alternatives –Offer compelling actions Remove filters between intelligence staff and the decision makers to whom they report Place staff physically or technologically close to decision makers

24©Jerry P. Miller High Visibility Do not mask their existence Cover-up attempts can lead to poor image Government intelligence staff focus 80% of their efforts on threats and 20% on opportunities Corporate intelligence staff focus 20% of their efforts on threats and 80% on opportunities

25©Jerry P. Miller Links Across the Firm: Access internal information as about 70% of the information needed for an intelligence report already resides in the firm Interact with other corporate components from sales, marketing, planning, purchasing, manufacturing, finance, etc. Establish direct and indirect reporting lines

26©Jerry P. Miller A Hard & Fast Rule: Locate intelligence close to decision makers who: –express a need for intelligence and –will provide requirements and targets for the intelligence function Here are some choices though to guide you…

27©Jerry P. Miller Four Variations: 1) If strategic and operational needs exist, establish multiple staff groupings. If dispersed decision making exist, then disperse intelligence functions. 2) Monitor intelligence needs and shift structure of intelligence to meet shifting market and strategy requirements.

28©Jerry P. Miller Four Variations Cont.: 3) Maintain a balance between strategic and operational intelligence needs. Operational needs will dominate, so separate the more important strategic needs. 4) The higher number of separate intelligence units will require more resources to ensure the consistency of operations among them.

29©Jerry P. Miller Criteria Not to be Overlooked: Balance strategic & operational needs Determine locus of decision making Recognize the companys structure Recognize its corporate culture Recognize shifts in its market environment